1. Financing Co-ops and Social Enterprise in New Brunswick

2. The New Brunswick Economic and Social Inclusion Corporation defines social enterprise as: Non profits, for profits, co-operatives and other organizations that earn some, or most, of their revenues from the sale of goods and services and reinvests the majority of its profits back into social, cultural or environmental goals.

3. Social Enterprise Nonprofit Small Business Community Needs Customer Wants

5. Reduce Poverty and Unemployment: jobs, training Provide Accessible Services: housing, health care, daycare, recreation, culture Address Environmental Issues: recycling, alternative transportation, energy, innovation, ecotourism Integrate Marginalized Populations into the economic, cultural and social fabric of the community Stimulate Economic Revitalization by creating locally- owned and operated businesses and keeping Investment and profits in the community

6. Depending upon your structure and capacity: Revenues, surplus Donations, foundations Grants, fundraising Owner/member equity/loans Investors, SBITC, CEDIF Crowdfunding (donation, reward, equity) Social Impact Bonds Loans, loan guarantees

7. Foundations, donations, grants, donation/reward crowdfunding, loans, guarantees

8. Some foundations, grants, donation/reward crowdfunding, loans

9. A few foundations, grants, owner equity/loans, investors, SBITC, CEDIF, reward/equity crowdfunding, SIBs, loans

10. As above plus member equity, member loans, reserve funds Charity, non profit, for profit

11. In addition to traditional banks, credit unions and financing companies, the following organizations can provide loans or loan guarantees to co-ops and social enterprises: CBDCs Social Enterprise Loan up to $150,000 Agriculture/Fisheries – variety of loans and guarantees ACOA and FAIP – Financial Assistance to Industry (manufacturing, processing, tourism, IT) Small Business Loan Guarantee Program (Industry Canada) Canadian Worker Co-op Federation (Tenacity Works) Saint John Community Loan Fund Cndn Youth Business Foundation, Youth Social Innovation

12. Venture Capital, Angel Investors SBITC CEDIF Crowdfunding Social Impact Bonds

13. Venture Capitalists are investors who provide capital to startups or small companies wishing to expand. IT companies are the most common targets. VCs goal is to earn a large return on their investments and they generally require a significant share in the ownership and control of the company. Examples are Dragon’s Den and BDC Venture Capital. Angel Investors provide financial backing for small startups and are often an entrepreneur's family and friends. The capital they provide can be a one-time injection of seed money or ongoing support to carry the company through difficult times. They may give more favorable terms than other lenders and are more focused on helping the business succeed, rather than just profit. Other than angel investors who are family/friends, there are those that are quasi-angels, i.e. Atlantic Angel Investors, NB Innovation Fund, Canadian Worker Co-op Federation

14. The SBITC provides a 30% non-refundable income tax credit of up to $75000 (for investments of up to $250,000 per year) to residents who invest in small businesses in the province. Effective 2014, the SBITC now also allows corporations and trusts to be eligible for a 15% tax credit on investments up to $500,000. Must be an existing business in NB, have a comprehensive business plan and investment plan, and at least 75% of employees must reside in NB. The investor must leave their money in for 5 years minimum at which time they can choose to redeem their shares or leave them in. Many businesses offer an additional return on investment, i.e prime plus 1%.

15. Coming to NB by Jan 2015: A CEDIF is a pool of capital, formed through the sale of shares to investors within a defined community (geographical, economic, cultural or industrial), and created to operate or invest in local businesses. CEDIFs provide access to capital for social enterprises and co-ops and can focus on developing many businesses in a community (blind pool), such food producers, or on a larger specific investment, such as a processing facility for local products. Like the SBITC, individual investors receive a 30% tax credit (up to $75000) and corporations at 15% credit (up to $75000). Both must leave their investment in for at least 5 years. May offer additional ROI Must have at least six directors elected from the community. May be eligible for an individual’s self-directed RRSP.

16. Donation-based Crowdfunding: supporters essentially donate money to support a cause and may receive in exchange a "thank you", a special mention, or even a gadget, but in any case the pledge is essentially a gratuity. (KIVA) Reward-based Crowdfunding, in which the backer receives a reward with a clear monetary value in exchange of the pledge. The reward is often a product or a pre-series item that the backer helped produce by pledging money. In this case the money pledged is similar to paying for a pre-order of a product or service. (Indego) Equity-based Crowdfunding, in which the backer receives shares of a company in exchange of the money pledged. In this case the money is pledged in the form of risk capital. Legislation for this is currently being developed for NB. Ceiling being considered is up to $1.5 million with a cap of $2500 per investor.

17. A social impact bond (SIB) is a “pay-for-success” contract where a commissioning body – typically the government – commits to pay for the achievement of a particular desired social outcome, i.e. reduction in incarceration/hospitalization. Through a SIB, private investment is used to finance social interventions. Provided that agreed upon social outcomes and savings to government are achieved, financial returns to investors are paid by government. Need to establish objective, measurable metrics to quantify outcomes and mitigate external factors. Investors risk not receiving their money back let alone an ROI. NB’s first potential SIB is being planned. NS, Alberta and Ontario are also in the planning process. Projects currently happening in other parts of the world. Obama administration has committed $500 million in the US

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